Tenon to acquire Bentley Jennison for £76m

Tenon is to buy RSM Bentley Jennison for £76m, a statement released to the
London Stock exchange revealed this morning.

The move will make
the seventh largest firm in the country with combined turnover of around £240m.

The business expects to make around £6m of savings from the deal, and the
combined entity will now be known as RSM Tenon.

Andy Raynor, CEO of Tenon, said: “This deal brings together two of the most
substantial entrepreneurial businesses in our industry. It is the beginning of a
new era of opportunity and growth for our teams and provides us with an
excellent platform form which to challenge traditional approaches to client
focus and service delivery.”

Raynor said the business had undertaken a number of smaller acquisitions but
said: “We have been waiting for this for a long period of time. We’ve always
wanted to do something more substantial.”

He said that the deal gave Tenon coverage in three more cities – Bristol,
Birmingham and Leeds – where business recovery services can be introduced.

Jennison would also bring an important presence for Tenon in providing
services to the public sector. “I think the public sector is looking for value
for money and that’s what Bentley Jennison, provide,” said Raynor.

He said the due diligence on the deal had revealed more “complimentary”
facets in Jennison than tenon had first imagined.

“I am sure that many businesses would have been interested in them [Jennison]
but you don’t merge with a people business on the basis of competition. You
merge if there’s a cultural fit.”

Tony Stockdale, managing partner of
Bentley Jennison
, said the firms had “recognised the significant
power” of joining up.

“This deal is an extremely exciting proposition and benefits all

To complete the deal Tenon proposes raises £40m on the stock exchange through
the placing of almost 89 million new ordinary shares.

The company has also arranged new banking facilities to help fund the deal.

Around £40m will be paid to Jennison partners in cash with around £17.5m in
shares. Another £18m in cash is payable over the next three years providing
performance targets are met. Another £9m could be paid “dependent on the
realisation of contingent assets” in Jennison.

The acquisition will need the endorsement of a general meeting involving
shareholders on 29 December.

Tony Stockdale and Richard Smith, head of Jennison internal audit business,
will join the board of the combined company along with Mark Lucas, head of
corporate finance at Tenon.

Current Tenon directors are already among the subscribers to the share
placing. CEO Raynor will take a little more than 200,000 bringing his holding up
to more than two million, but far the biggest stake among the directors.

Tenon currently turns over £160m and is the ninth largest firm in the country
while Bentley Jennison takes £80m and is positioned at number 14.

Tenon’s share price rose by half of one percent at the time of writing this
story, to 50.75p. Tenon’s market capitalisation stood at £97m.

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